ICSE Class 10 Economics Board Exam Question Paper 2024 with Solutions

CISCE Class 10 Economics Board Exam Question Paper 2024 with Solutions

SECTION A (40 Marks)

Attempt all questions from this Section

Q1. Choose the correct answers to the questions from the given options. (Do not copy the questions, write the correct answer only.) [16 Marks]

1.1. If the rate of tax falls with an increase in income, it is called as ______. [1 Mark]
1. Regressive
2. Progressive
3. Digressive
4. Proportional

Answer: (1) Regressive

A regressive tax is one in which the tax rate drops as the income of the taxpayer rises.

Teacher's Note:
a) Remember that in a regressive tax, the burden falls disproportionately heavier on lower-income earners.
b) Do not confuse regressive tax with progressive tax, where the tax rate increases as income increases.

1.2. Which is an assumption to law of demand? [1 Mark]
1. No change in price of factor input.
2. No change in size and composition of population.
3. No change in number of firms operating in a market.
4. No change in goal of a firm.

Answer: (2) No change in size and composition of population.

Population size and composition assumptions are crucial because shifts in population can impact total demand for a good independently of price changes.

Teacher's Note:
a) Ceteris paribus (other things remaining constant) is the core condition for the law of demand to operate.
b) Factors like input prices, number of firms, and goals of a firm relate to supply rather than demand assumptions.

1.3. Which is an essential feature of barter system? [1 Mark]
1. It is based on transfer of value.
2. It is based on double coincidence of wants.
3. It is based on unit of account.
4. It is based on store of value.

Answer: (2) It is based on double coincidence of wants.

In a barter system, a transaction requires that what one person wants to sell is exactly what the other person wants to buy.

Teacher's Note:
a) Double coincidence of wants is the biggest drawback and defining feature of the barter system.
b) Unit of account and store of value are characteristics introduced by the evolution of money.

1.4. If a labourer does not work for a day, his one day 's work will be lost forever. It implies: [1 Mark]
1. Labour is less mobile.
2. Labour is perishable.
3. Labour is less efficient.
4. Labour is sensitive in nature.

Answer: (2) Labour is perishable.

Labour cannot be stored; hence, if a day passes without work, that productive capacity is gone forever.

Teacher's Note:
a) Labour is embodied in the labourer and cannot be separated from the worker.
b) Perishability distinguishes labour from physical capital goods which can be stored.

1.5. With reference to Perfect competition form of market, choose the odd one out. [1 Mark]
1. Restricted entry
2. Perfect knowledge
3. Homogeneous products
4. Perfect mobility

Answer: (1) Restricted entry

Perfect competition is characterized by free entry and exit of firms, not restricted entry.

Teacher's Note:
a) Restricted entry is a key feature of monopoly or oligopoly markets.
b) Ensure you memorize all characteristics of perfect competition including homogeneous products and perfect knowledge.

1.6. Identify the degree of elasticity of supply from the following graph: [1 Mark]
[Figure: A straight line supply curve S passing through the origin O with axes Price on Y and Supply on X]
1. ES > 1
2. ES < 1
3. ES = 1
4. ES = 0

Answer: (3) ES = 1

Any straight line supply curve drawn through the origin has a unitary elasticity of supply (ES = 1) over its entire length.

Teacher's Note:
a) A supply curve starting from the origin always has unit elasticity regardless of its steepness.
b) If a supply curve originates from the Y-axis, elasticity is greater than 1, and if from the X-axis, it is less than 1.

1.7. Maruti, Tata and Hyundai are examples of which form of market? [1 Mark]
1. Perfect competition
2. Oligopoly
3. Monopoly
4. Duopoly

Answer: (2) Oligopoly

An oligopoly is a market structure dominated by a few large firms competing against each other.

Teacher's Note:
a) The Indian car market is shared primarily among a few major players like Maruti, Tata, and Hyundai, making it an oligopoly.
b) High barriers to entry characterize this market form.

1.8. With price being same an increase in the price of inputs will lead to ______ in the supply curve. [1 Mark]
1. Upward movement
2. Rightward shift
3. Downward movement
4. Leftward shift

Answer: (4) Leftward shift

An increase in input costs reduces profitability, causing producers to supply less at the same price, shifting the supply curve to the left.

Teacher's Note:
a) Changes in price cause movements along the supply curve, while changes in other factors (like input costs) cause shifts.
b) A decrease in supply is represented by a leftward shift.

1.9. Which of the following is not an advantage of division of labour? [1 Mark]
1. Reduces cost of production
2. Expansion of employment
3. Low quality goods
4. Inventions

Answer: (3) Low quality goods

Division of labour improves efficiency and productivity, and is not associated with producing low quality goods.

Teacher's Note:
a) Division of labour enhances skill and saves time, lowering production costs.
b) Monotony of work is a disadvantage, but low quality goods is incorrect.

1.10. The State Electricity Board sells electricity at cheaper rates for domestic use than for commercial use. Given statement shows an act of ______. [1 Mark]
1. Product differentiation
2. Price discrimination
3. Consumer exploitation
4. Price determination

Answer: (2) Price discrimination

Charging different prices for the same service (electricity) based on the type of consumer (domestic vs. commercial) is price discrimination.

Teacher's Note:
a) Price discrimination is commonly practiced by monopolies and public utilities.
b) It is done to balance social welfare with commercial viability.

1.11. The year 2023 was celebrated as 'International Year of Millets' and the government decided to subsidize the production of millets. In such case the supply curve will _______. [1 Mark]
1. Shift to the right
2. Shift to the left
3. Be horizontal
4. Be vertical

Answer: (1) Shift to the right

Subsidies reduce production costs, enabling producers to supply more at any given price, shifting the supply curve to the right.

Teacher's Note:
a) Government financial support or subsidies act as a positive stimulus for market supply.
b) An increase in supply is always depicted as a rightward shift.

1.12. Mr. Rao needs to pay license fee to the government to start his electric vehicle shop and some documents to meet the safety norms. The revenue earned by the government from this process will be called as ______ revenue. [1 Mark]
1. Commercial
2. Central
3. GST
4. Administrative

Answer: (4) Administrative

Fees collected for licenses, permits, and safety norms are classified under administrative revenue.

Teacher's Note:
a) Administrative revenue arises from the administrative functions of the government.
b) Commercial revenue comes from the sale of goods and services produced by government enterprises.

1.13. The 'Right' which allows the consumer to receive due consideration at appropriate forum relating to his/ her welfare is ______. [1 Mark]
1. Right to education.
2. Right to seek redressal.
3. Right to be heard.
4. Right to be informed.

Answer: (3) Right to be heard.

The right to be heard ensures that a consumer's complaints receive due consideration in appropriate forums.

Teacher's Note:
a) This right gives consumers the platform to voice grievances.
b) Do not confuse it with the right to seek redressal, which deals with getting compensation for losses.

1.14. The elasticity of demand for school bag will be ______. [1 Mark]
1. Elastic
2. Perfectly elastic
3. Unitary elastic
4. Inelastic

Answer: (4) Inelastic

School bags are essential for students with few substitutes, making their demand inelastic.

Teacher's Note:
a) Necessities generally have inelastic demand.
b) Price changes do not significantly alter the quantity demanded for essential educational items.

1.15. When State Bank of India is under financial crisis and borrows money from Central Bank at a certain rate against approved securities, it will be called as ______. [1 Mark]
1. Interest rate
2. Lending rate
3. Reverse lending
4. Bank rate

Answer: (4) Bank rate

The rate at which the central bank lends money to commercial banks against approved securities is called the bank rate.

Teacher's Note:
a) Bank rate is a key quantitative instrument of monetary policy.
b) It is charged during times when commercial banks face financial shortages.

1.16. If Coke and Fanta are close substitutes to each other, a rise in price of Coke will lead to ______ for Fanta. [1 Mark]
1. Decrease in demand.
2. Increase in demand.
3. Increase in quantity supplied.
4. No change in demand.

Answer: (2) Increase in demand.

When the price of Coke rises, consumers substitute it with Fanta, causing an increase in demand for Fanta.

Teacher's Note:
a) Substitute goods have a direct positive cross-price elasticity of demand.
b) An increase in the price of one shifts the demand curve of the substitute to the right.

Q2. [8 Marks]

2.1. Explain any two causes for the growth of public expenditure. [2 Marks]

Answer:
1. Growth of Population: As population increases, the government's responsibility to provide public goods, education, health, and civic infrastructure expands, leading to higher public spending.
2. Development Programmes: Government investments in infrastructure projects such as roads, railways, power plants, and industrialization drive up public expenditure.

Teacher's Note:
a) Clearly state the heading for each point followed by a brief explanation.
b) Mentioning welfare state expansion is also an acceptable alternative point.

2.2. What are funded debts? [2 Marks]

Answer:
Funded debts are long-term loans for which the government establishes a separate sinking fund, depositing money into it annually so that the principal amount is fully paid off upon maturity.

Teacher's Note:
a) Highlight that funded debts have a structured repayment mechanism through a sinking fund.
b) Distinguish them from unfunded (floating) debts which are short-term borrowings.

2.3. How can we define the term 'market' in economics? [2 Marks]

Answer:
In economics, a market is defined as a mechanism or arrangement where buyers and sellers of a commodity interact with one another to facilitate the purchase and sale of goods and services.

Teacher's Note:
a) Emphasize that a market does not necessarily mean a physical geographical place.
b) Interaction and exchange between buyers and sellers are the core elements.

2.4. 'A state of running or hyperinflation in any economy is very harmful for production'. Justify the statement with two reasons. [2 Marks]

Answer:
1. Reduction in Saving: Rapid price increases erode the real value of money and purchasing power, discouraging savings and investment.
2. Misallocation of Resources: Hyperinflation disrupts the price mechanism, forcing producers to shift resources away from essential goods to speculative non-essentials in search of quick profits.

Teacher's Note:
a) Explain how uncertainty during hyperinflation paralyzes economic planning.
b) Both points must directly link the impact back to production and investment.

Q3. [8 Marks]

3.1. What is the formula for percentage method of calculating price elasticity of supply? [2 Marks]

Answer:
Price elasticity of supply (e_s) is calculated as the ratio of percentage change in quantity supplied to the percentage change in price:
e_s = (Percentage change in Quantity Supplied) / (Percentage change in Price)
e_s = (ΔQ / Q × 100) / (ΔP / P × 100) = (ΔQ / ΔP) × (P / Q)

Teacher's Note:
a) Clearly define all symbols: ΔQ for change in quantity, ΔP for change in price, P for initial price, and Q for initial quantity.
b) Always write the formula completely with proper mathematical notation.

3.2. What is walking inflation? [2 Marks]

Answer:
Walking inflation refers to a moderate rise in the average price level of commodities at a controlled rate, typically ranging between 3% and less than 10% annually, acting as a warning sign of an overheating economy.

Teacher's Note:
a) Mention the specific percentage range (3% to 10%) as examiners look for this classification.
b) Distinguish it from creeping inflation (1% to 3%) and running inflation.

3.3. (a) What does RTI stand for? [1 Mark]

Answer:
RTI stands for Right to Information.

Teacher's Note:
a) Write the full form clearly without spelling errors.
b) This is a direct factual question.

3.3. (b) What provision is provided under RTI Act to the citizens of the country? [1 Mark]

Answer:
The RTI Act empowers Indian citizens to request and access information, documents, and records held by public authorities and government institutions.

Teacher's Note:
a) Highlight that it promotes transparency and accountability in governance.
b) Mentioning the right to inspect works and obtain certified copies of records completes the answer.

3.4. Analyse the given graphs and identify the type of elasticity of demand of: [2 Marks]
a. Picture 1
b. Picture 2
[Figure: Picture 1 shows a horizontal demand line parallel to X-axis. Picture 2 shows a vertical demand line parallel to Y-axis.]

Answer:
a. Picture 1: Perfectly elastic demand (e_p = ∞)
b. Picture 2: Perfectly inelastic demand (e_p = 0)

Teacher's Note:
a) A horizontal demand curve indicates infinite responsiveness to price changes.
b) A vertical demand curve indicates zero responsiveness to price changes.

Q4. [8 Marks]

4.1. What is the legal definition of money? [2 Marks]

Answer:
In legal terms, money is defined as any coin or currency note declared as legal tender by the government, which must be accepted universally as a medium of exchange and for settling debts.

Teacher's Note:
a) The key legal term here is legal tender backed by government authority.
b) Fiat money and legal backing are core concepts to include.

4.2. How is internal debt different from external debt? (One point) [2 Marks]

Answer:

Teacher's Note:
a) Since the question asks for one point of difference, present it clearly in a comparative table.
b) Source of borrowing (domestic versus foreign) is the distinguishing criterion.

4.3. State whether the following statement is true or false. Give reason for your answer.
The capital like printing machines, tools when used in process of production are subject to depreciation. [2 Marks]
1. True
2. False

Answer: (1) True

Reason: Capital assets undergo regular wear and tear, obsolescence, and consumption during the production process, which leads to a reduction in their value, known as depreciation.

Teacher's Note:
a) Always state whether the statement is true or false before giving the reason.
b) Wear and tear during production is the direct cause of depreciation on fixed capital.

4.4. Define the term public finance. [2 Marks]

Answer:
Public finance is the branch of economics that studies the income, expenditure, financial administration, and debt operations of public authorities (government bodies).

Teacher's Note:
a) Mentioning government revenue and expenditure is essential.
b) Referencing economist Dalton's definition adds academic value to the answer.

SECTION B (40 Marks)

Attempt any four questions from this Section

Q5. [10 Marks]

5.1. (a) What is the meaning of the productivity of land? Define productivity of land. [2 Marks]

Answer:
Productivity of land refers to the output generated per unit of land. It measures the efficiency and yielding capacity of land in producing agricultural crops or other goods.
Productivity of land = (Total Quantity Produced) / (Total Units of Land Used)

Teacher's Note:
a) Give both the verbal definition and the mathematical formula for completeness.
b) Land productivity varies based on natural fertility and human improvements.

5.1. (b) Explain any three factors affecting productivity of land. [3 Marks]

Answer:
1. Natural Factors: Soil composition, texture, chemical properties, and inherent fertility directly determine the natural productivity of land.
2. Size of Land Holdings: Larger holdings often enable modern, mechanized farming methods, whereas fragmented and small holdings limit productivity.
3. Improvement on Land: Investments in infrastructure like irrigation, drainage, and fencing enhance the productive capacity of soil.

Teacher's Note:
a) Write three distinct headings with concise explanations for full marks.
b) Mentioning climate and topography as alternative natural factors is also valid.

5.2. Give five points of difference between Commercial and Central Bank. Name the bank which has sole authority to issue currency in India. Mention three ways it differs from Commercial bank. [5 Marks]

Answer:
The Reserve Bank of India (RBI) is the central bank with sole authority to issue currency in India.

Teacher's Note:
a) Name the RBI explicitly before presenting the tabular differences.
b) Ensure all five basis points clearly contrast the central bank's macroeconomic role with commercial banking functions.

Q6. [10 Marks]

6.1. (a) What is the meaning of creeping inflation? [2 Marks]

Answer:
Creeping inflation refers to a slow and mild rise in the general price level of commodities, typically ranging between 1% and 3% annually. It is considered safe and acts as an incentive for economic growth.

Teacher's Note:
a) Mention the rate (1% to 3%) clearly.
b) Emphasize that it is manageable and generally beneficial for a developing economy.

6.1. (b) Explain any three causes of demand-pull inflation. [3 Marks]

Answer:
1. Increase in Disposable Income: Rising consumer incomes lead to higher aggregate demand for goods and services, pushing prices up.
2. Increase in Population: Population growth increases overall demand for consumer goods, putting pressure on existing supplies.
3. Increase in Money Supply: Excessive money supply in the economy increases purchasing power and aggregate demand faster than aggregate output.

Teacher's Note:
a) Demand-pull inflation occurs when aggregate demand exceeds aggregate supply ("too much money chasing too few goods").
b) List and explain each cause clearly with bullet points.

6.2. (a) What is an overdraft facility? [2 Marks]

Answer:
An overdraft facility is a credit arrangement provided by a bank allowing current account holders to withdraw money in excess of their actual account balance up to a sanctioned limit, with interest charged only on the overdrawn amount.

Teacher's Note:
a) Specify that it applies mainly to current account holders.
b) Highlight that interest is calculated strictly on the amount utilized, not the total sanctioned limit.

6.2. (b) Differentiate between demand deposits and fixed deposits. (Three points) [3 Marks]

Answer:

Teacher's Note:
a) Structure the answer in a comparative table with three distinct points.
b) Emphasize liquidity differences between savings/current accounts and fixed time deposits.

Q7. [10 Marks]

7.1. State and explain the law of demand with the help of a hypothetical schedule and graph. [7 Marks]

Answer:
Statement of the Law of Demand: The law of demand states that, other things remaining constant (ceteris paribus), there is an inverse relationship between the price of a commodity and its quantity demanded - when price rises, demand falls, and when price falls, demand rises.

Hypothetical Demand Schedule for Apples:

[Figure: A downward sloping demand curve DD showing inverse relation between Price on Y-axis and Quantity on X-axis based on the schedule data.]
Explanation: As seen in the schedule and graph, when the price of apples drops from Rs. 100 to Rs. 90, the quantity demanded increases from 3 kg to 6 kg. This inverse relationship is graphically represented by a downward sloping demand curve.

Teacher's Note:
a) A complete answer must include the definition statement, schedule table, text explanation, and reference to the graph.
b) Remind students that the assumption of ceteris paribus is mandatory when stating the law.

7.2. Read the following statements: [3 Marks]

7.2. (a) State whether demand will be Elastic or Inelastic. Give reasons for your answer.
The demand for salt by households. [1.5 Marks]

Answer:
The demand for salt is inelastic.
Reason: Salt is an essential necessity consumed in very small quantities, and households spend a negligible fraction of their income on it. Price changes do not significantly affect the quantity consumed.

Teacher's Note:
a) Clearly state inelastic first.
b) Explain that lack of substitutes and necessity nature drive this inelasticity.

7.2. (b) State whether demand will be Elastic or Inelastic. Give reasons for your answer.
A consumer prefers to postpone the purchase of a car to avail more of year ending discount. [1.5 Marks]

Answer:
The demand for the car in this context is elastic.
Reason: Durable luxury goods whose purchases can be postponed have elastic demand because consumers readily alter their buying timing based on price discounts.

Teacher's Note:
a) Identify the demand as elastic due to postponement possibility.
b) Link post-ponability of consumption directly to price sensitivity.

Q8. [10 Marks]

8.1. (a) Define labour as a factor of production. [2 Marks]

Answer:
In economics, labour refers to any physical or mental human effort exerted in exchange for economic reward (wages) aimed at the production of goods and services.

Teacher's Note:
a) Emphasize both physical and mental effort.
b) Clarify that work done purely out of love, affection, or pleasure without economic reward is not considered labour in economics.

8.1. (b) Mention any three decision making functions of an entrepreneur. [3 Marks]

Answer:
1. Risk Assessment and Management: Evaluating financial, market, and operational risks and implementing strategies to mitigate them.
2. Financial Management: Determining capital requirements, budgeting, sourcing funds, and controlling operational costs.
3. Resource Allocation: Distributing resources efficiently across different business operations to maximize output and productivity.

Teacher's Note:
a) List three distinct entrepreneurial functions with clear subheadings.
b) Highlight that decision-making is the core function distinguishing an entrepreneur from other factors of production.

8.2. How are consumers exploited by producers and retailers? [5 Marks]

Answer:
Producers and retailers exploit consumers through various unfair trade practices:
1. Deceptive Pricing: Charging prices higher than the Maximum Retail Price (MRP) or hoarding essential goods to artificially inflate prices.
2. Adulteration: Mixing low-quality, inferior, or harmful substances into pure food products while charging premium prices.
3. Deceptive Advertising: Making false or exaggerated claims regarding the quality, utility, or benefits of products through advertisements.
4. False Weights and Measurements: Using manipulated scales, weights, or measuring instruments to deliver lesser quantities than paid for.
5. Monopolistic Practices: Exploiting market dominance to supply substandard goods or charge exorbitant prices in the absence of alternatives.

Teacher's Note:
a) Provide at least four to five well-explained points for a 5-mark question.
b) Real-life examples like MRP violations or food adulteration strengthen the answer.

Q9. [10 Marks]

9.1. Give any five points of difference between direct and indirect tax. [5 Marks]

Answer:

Teacher's Note:
a) Present five clear comparative points in a table.
b) Shifting of tax burden is the primary distinction between direct and indirect taxes.

9.2. (a) What are proportional taxes? [2 Marks]

Answer:
A proportional tax is a tax system where the rate of taxation remains constant regardless of the taxpayer's level of income (e.g., a flat 20% tax on all income levels).

Teacher's Note:
a) Define proportional tax emphasizing the constant tax rate across all income brackets.
b) Differentiate it briefly from progressive and regressive tax structures.

9.2. (b) Explain any three features of a monopoly market. [3 Marks]

Answer:
1. Single Seller: There is only one producer or seller of a commodity, meaning the firm and the industry are identical.
2. Price Maker: A monopolist has complete control over supply and can set the price of the product.
3. Price Discrimination: A monopolist can charge different prices to different consumers for the same product based on market conditions.

Teacher's Note:
a) List three core features with clear headings and explanations.
b) Mentioning barriers to entry is also an acceptable feature.

Q10. [10 Marks]

10.1. (a) What do you mean by market supply? [2 Marks]

Answer:
Market supply refers to the total quantity of a commodity that all individual firms in the industry are willing and able to offer for sale at various given prices during a specified period of time.

Teacher's Note:
a) Distinguish between individual supply and market supply.
b) Market supply is the horizontal summation of all individual firm supply curves.

10.1. (b) Briefly explain any three factors that affect supply of a commodity. [3 Marks]

Answer:
1. Price of the Commodity: Higher price leads to higher profit margins, encouraging producers to increase supply, and vice versa.
2. Input Prices: An increase in the cost of raw materials and factors of production reduces profitability, leading to a decrease in supply.
3. Taxation and Subsidies: High taxes increase production costs and reduce supply, whereas government subsidies lower costs and boost supply.

Teacher's Note:
a) Give three distinct factors with concise explanations.
b) Ensure the relationship between cost/price and supply direction is clearly stated.

10.2. Read the extract and answer the following question:
Food adulteration is a complex issue that requires a multi-pronged approach involving government intervention, industry cooperation, and consumer awareness. In Country X, addressing food adulteration is an ongoing challenge, but with a concerted effort from all stakeholders, there is hope for creating a safer and more trustworthy food supply chain in the future.
a. In order to secure consumer rights what duties should the consumers fulfil?
b. Mention any two harmful effects of food adulteration. [5 Marks]

Answer:
a. Duties of consumers:
1. Making Informed Choices: Insisting on full disclosures regarding the quality, quantity, price, and manufacturing details of goods before purchasing.
2. Being Quality Conscious: Checking for standard certification marks like ISI, Agmark, or ISO before buying products.
3. Asserting Rights: Exercising consumer rights actively and filing complaints against unfair trade practices.
b. Harmful effects of food adulteration:
1. Chronic Health Problems: Adulterants and toxic chemicals can cause severe organ damage, food poisoning, allergies, or long-term diseases like cancer.
2. Nutritional Deficiency: Adulteration reduces the nutritional value of food, impairing growth and weakening the immune system.

Teacher's Note:
a) Divide the answer clearly into part (a) duties and part (b) harmful effects.
b) Reference certification marks in part (a) and health impacts in part (b) to secure full marks.